Chicago's Sales Tax Rate and What It Covers

Chicago's combined sales tax rate is 10.25 percent. This rate is made up of the Illinois state sales tax of 6.25 percent plus the Cook County tax of 1.25 percent plus the City of Chicago tax of 2.25 percent. When you buy something in Chicago, the store adds 10.25 percent to the price before you pay.

Not everything you buy is taxed at this rate. Groceries — items like milk, bread, meat, and vegetables that you cook at home — are taxed at only 1.25 percent in Chicago, which is the Cook County rate alone. Restaurant meals and prepared foods are taxed at the full 10.25 percent. Prescription medications are not taxed at all, but over-the-counter medicines and vitamins are taxed at the full rate.

Clothing and shoes under $110 per item are not taxed in Illinois, but once a single item costs $110 or more, the full 10.25 percent applies to the entire purchase. This means a $109 shirt is tax-free, but a $110 shirt is taxed.

Key Takeaways

  • Chicago's sales tax is 10.25 percent on most purchases, combining state, county, and city taxes.
  • Groceries you prepare at home are taxed at only 1.25 percent, while restaurant meals are taxed at the full rate.
  • Clothing and shoes under $110 per item are tax-free, but items $110 and above are fully taxed.
  • Prescription drugs are not taxed, but over-the-counter medicines and vitamins are taxed at 10.25 percent.

How the Tax Breaks Down by Source

The 10.25 percent rate in Chicago comes from three different tax sources, each collected by a different government body. The Illinois state sales tax of 6.25 percent goes to the state. The Cook County tax of 1.25 percent goes to the county government. The City of Chicago tax of 2.25 percent goes to the city.

When you make a purchase, the store collects all three taxes together and sends them to the appropriate agencies. You see only one number on your receipt — the total tax — but it is divided among three governments. This is why the rate is higher in Chicago than in other parts of Illinois: some counties and cities add smaller local taxes or none at all.

Items That Are Taxed Differently or Not at All

Several categories of items have their own tax rules in Chicago. Groceries — defined as food you take home and prepare yourself — are taxed at 1.25 percent instead of the full rate. This includes raw meat, produce, dairy, bread, and canned goods. It does not include hot food from a deli counter, rotisserie chicken, or anything meant to be eaten when ready.

Prescription medications are exempt from sales tax entirely. You need a valid prescription from a doctor, and the pharmacist will not charge tax. Over-the-counter medicines like aspirin, cold medicine, and antacids are taxed at the full 10.25 percent because they are not prescribed.

Clothing and shoes have a special rule: items under $110 are tax-free, but the moment a single item reaches $110, the entire purchase is taxed. A pair of $109 shoes costs $109. A pair of $110 shoes costs $110 plus $11.28 in tax. This rule applies to the item itself, not the total transaction — so you could buy five $100 shirts tax-free, but one $150 jacket would be taxed.

What Happens When You Buy Online or Out of State

If you order something online from a retailer that has a physical location in Illinois or that meets certain sales thresholds, the retailer must collect Chicago sales tax and send it to the city. This applies whether the item ships from Chicago, from elsewhere in Illinois, or from out of state. The tax rate depends on where you have it shipped: if it goes to a Chicago address, you pay 10.25 percent.

If you buy something in person outside Chicago — say, in a suburb or another state — and bring it back to Chicago, you do not pay Chicago sales tax at the time of purchase. However, Illinois law technically requires you to pay a "use tax" equal to the sales tax you would have paid if you had bought it in Chicago. In practice, this use tax is rarely enforced for individual purchases, but it is the law.

How Sales Tax Appears on Your Receipt

On a Chicago receipt, you will see a subtotal (the price before tax), then a line for tax, then a total. The tax line shows the amount in dollars and cents. Some receipts also show the tax rate as a percentage. If you buy groceries, you may see two different tax amounts on one receipt — 1.25 percent on the food items and 10.25 percent on any non-food items like paper towels or cleaning supplies.

The way tax is rounded can vary slightly by store. Most stores round the total tax to the nearest cent. If the math comes out to $10.254, the store rounds down to $10.25. If it comes out to $10.255, the store rounds up to $10.26. This is why two identical purchases might have slightly different tax amounts.

Sales Tax Rates in Nearby Areas

If you shop just outside Chicago's city limits but still in Cook County, the tax rate drops to 8.25 percent — you lose the 2.25 percent city tax. In other Illinois counties, the rate varies. DuPage County, which borders Cook County to the west, has a combined rate of 8.25 percent. Will County to the south has 8.25 percent. Lake County to the north has 8.25 percent.

This difference matters if you live near Chicago's edge. A $100 purchase in Chicago costs $110.25 with tax. The same purchase in a nearby suburb costs $108.25 with tax — a difference of $2. For large purchases, the savings can add up, which is why some people shop just outside the city limits.

Frequently Asked Questions

Do I pay sales tax on groceries in Chicago?

Groceries — food you take home and cook — are taxed at only 1.25 percent in Chicago. This includes produce, meat, dairy, bread, and canned goods. Hot prepared food from a deli or restaurant counter is taxed at the full 10.25 percent.

Are clothes tax-free in Chicago?

Clothing and shoes under $110 per item are tax-free in Illinois. Once a single item costs $110 or more, the full 10.25 percent sales tax applies to that item. The $110 threshold applies to each piece, not to your total purchase.

What if I buy something online and have it shipped to Chicago?

If the online retailer collects sales tax (most major retailers do), you pay Chicago's 10.25 percent rate on items shipped to a Chicago address. If the retailer does not collect tax, you are technically responsible for paying use tax, though this is rarely enforced for individual purchases.

Is prescription medication taxed in Chicago?

Prescription medications are not taxed. Over-the-counter medicines, vitamins, and supplements are taxed at the full 10.25 percent because they do not require a prescription.

Why is Chicago's sales tax so high?

Chicago's 10.25 percent rate combines the Illinois state tax of 6.25 percent with Cook County's 1.25 percent and the City of Chicago's 2.25 percent. The city tax is higher than in many other places because Chicago uses sales tax revenue to fund city services and infrastructure.